Want to secede? The IRS has news for you
Departing Americans will find it hard to escape the long arm of Uncle Sam.
But are supporters of such an idiotic move thinking about the potential tax consequences?
Escaping the long taxing arm of Uncle Sam is difficult and can be expensive. Americans who live abroad still must pay U.S. taxes if they have yearly earnings above $100,000, a policy which has long been a sore point for expatriates.
Americans abroad are required to file taxes with the IRS even if they don't owe the U.S. any money. Some foreign residents may even still owe state taxes. To make matters worse, U.S. citizens who renounce their citizenship are subject to a one-time exit tax of 15% on the fair market value of all their assets less their basis costs. Giving up a U.S. passport doesn't get someone out of paying any back taxes.
Seceding from the union also presents all sorts of practical problems for states. Texas, which many Texans are quick to point out was for a brief time a foreign country, is a case in point. Do the 65,000 or so residents of the Lone Star State who have signed the petition believe that the U.S. would just hand over tens of billions in assets such as interstate highways, military bases and border crossings without anything in return? It's doubtful.
An independent Texas would still need plenty of help from the U.S. The Texas Rangers and the state's National Guard would probably not be able to battle Mexican drug cartels on their own. Thank goodness, most Texans and residents of other states oppose this daft idea, which didn't work out so well when it was last tried 150 years ago.
Though the idea of secession from the U.S. seems tinfoil-hat crazy, wealthier Americans are increasingly renouncing their citizenship for tax reasons. According to Fox News.com, as many as 8,000 U.S. citizens are expected to give up their U.S. passports this year, more than double the 3,805 in 2011. The move can save these former Americans big bucks.
"Some are philosophically disgusted at the course our country is taking, in all kinds of ways," tax attorney James Duggan told the site. "They're making a strong protest of 'enough is enough.' But largely, it's an economic decision."
Perhaps those who want to secede also are disgusted by the direction the country is going. If that's true, they should fight for their beliefs. Those that want to quit the U.S. are like children who take their ball home when they are losing on the playground. It's the ultimate exercise in selfishness.
Follow Jonathan Berr on Twitter @jdberr
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I think the highways were built by the states using money from the Fed who got it from the citizens of the states so it is a return of their money. The military bases they can have. That would be part of the billions of dollars we wouldn't have to help pay for in the Defense Department. The border crossings are part of what is the problem. We could actually properly set up some border crossings.
We would also save our share of the billions in foreign aid given to all the countries that hate us. In fact once we are a foreign country we could apply for foreign aid.
Jonathan Berr, listen to you. Only you know how stupid it is to leave the union. You're so high up on that horse! If you were a real journalist, you'd be looking into why people want this instead of criticizing.
Joke of an article, joke of an author.
This article is almost as much of a hoot as my other post here.
Jonathon Berr doesn't seem to recognize the fact that if Texas seceded, the residents of the state would no longer be United States citizens, they would be Texas Citizens. Therefore the IRS would have no more authority to tax them as it has to tax the French in France or the Germans in Germany.
Any thought that back taxes wouldn't be dissolved when the political bonds are dissolved must be trying on Mr. Berr's tinfoil hat. There is precedence for this when the colonies seceded from the English.
Yes the original 13 colonies with a population of around five million and virtually no economy made it. Texas with a population of 25 million and the world's fourteenth largest economy would have no problem at all.
If 34 states decided to pull out of the Union who do you really think would have an issue. I don't think military support would be an issue. Washington can keep the debt after all it theirs I didn’t spend any of that money. Will take the rest you have good luck when the China comes knocking. Anyone who thinks that any state or if a large group of people leaves the union, are going to pay taxes might want to rethink that.
Slowly but surely it is dawning on people this election was a scam.....We've been hoodwinked on a massive scale. You don't have millions turning out in support of Chick-fillet, the largest turn-over in elected officials in history only two years earlier, neighborhoods accross the country with a 17 to 1 Romney yard sign advantage and expect me to believe this was legitamite.
Precincts in Pa. where obama get 142% more votes than residents that live there. Ohio precincts where Romney got zero votes? And I'm supposed to believe the happlles, ruderless, clueless, muslim communist won the hearts of the majority of thinking people?
" It's the ultimate exercise in selfishness." Or they may think the deck is stacked against them as some articles suggest.
Areas with 100% Obama votes are pretty much suspect especially when an article stated a person had to try three times to get her vote cast for Romney before she could accept the ballot.
Maybe these people don't like killing babies, living off the Gov't or perhaps they feel the money they earn is theirs while taxes are too high. There are many reasons they may choose to secede other than for selfish reasons. They just may feel overwhelmed at this time.
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Breaking up big banks is an untested solution to the too big to fail problem that attempts to isolate and dismantle large, troubled institutions while protecting the rest of the economy.
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